No. 340.
Mr. Biddle to Mr. Fish.

No. 87.]

Sir: I have the honor to transmit to yon herewith a copy and translation of an “exposition” addressed to the National Constituent Congress by the ministry of the government of Salvador, reviewing the policy of the administration, and submitting for its sanction the late war-measures of the President, at variance with the letter of the constitution of 1871.

I also append the resolution of the convention approving the entire course of President Gonzalez, as stated in the aforesaid memorial.

A project has been presented to the nation from the convention for the formation of a bank, of which I annex a copy and translation. The late revolutions and foreign wars have embarrassed the finances of the state and commercial prosperity, and the creation of a bank separate from the government, with securities from abroad, for hypothecations, loans, discounts, and circulation, is thus suggested as a safe basis for monetary transactions. I also annex a copy of a decree of the President of the republic, consonantly to the above resolution of the convention, dated the 4th instant, in which he prescribes the establishment of a bank as aforesaid, with stipulations as authorized by the Congress. The fourteenth article thereof establishes The Bank for Hypothecation of Real Estate of Salvador so soon as the subscription for a moiety of its stock is completed, and agencies are to be established in all the departments of the republic, to be organized according to the regulations.

Also, an agency is to be at once placed in London, to represent the bank in its relations and operations with foreign stockholders and with other persons or establishments. The office to be performed by three employés, one to be named by the foreign shareholders, another by the national shareholders, and the last by the government. If the directory of the bank shall deem it convenient hereafter to establish other agencies in other foreign places, it may do so, the government approving, and with the same terms as for that at London.

I have, &c.,

[Inclosure 1.—Translation.]

constituent congress.

Exposition of the Salvadorean cabinet to the National Constituent Congress, submitting for its approval the measures taken in consequence of the extraordinary situation in which the republic was placed.

Representatives: By the disposition of the Marshal President of the republic and consonantly to the terms of your convocation, the undersigned ministers of state have the honor to relate and to submit to you the policy and measures which the government has been obliged to dictate, owing to the exceptional circumstances through which the nation has passed, whose great interests it was impossible to preserve without displaying the activity which the intrigues and machinations of the disaffected rendered necessary.

Notorious are the motives, as flimsy as hurtful to Salvador, which served as a pretext to the ex-President of Honduras, Don José Maria Medina, to openly take a hostile [Page 785] attitude against this republic, to close official relations, and to declare war, issuing the unjustifiable decree dated 25th of March of this year.

With this emergency, the executive authority was obliged to use the foremost of its attributes “to maintain inviolable the sovereignty and independence of the republic and the integrity of its territory, and to conserve the peace and domestic tranquillity.”

In every light the said decree of the Honduranean government amounted to a formal declaration of war, unless it were that its armies had not at once invaded Salvador.

The unlooked-for rupture of every kind of official and private relations between both countries, the unjustifiable insults and injuries, as grave as gratuitous, embodied in that decree, and, lastly, the clear and determined words with which the republic of Honduras declared itself in a state of war with Salvador, are facts which demonstrate, in an irrefutable manner, the truth of the proposition which we have enunciated.

With these antecedents, and in the certainty that the Honduranean government was accumulating every kind of warlike supply to commence hostilities at the opportune time, and also seeing that the reactionaries redoubled their efforts to produce discord in the interior, it appears evident that the government had drawn the line of conduct proper to preserve harmless the national honor and the republic from the threatened evils, and at the least sacrifice: to accept war, to prosecute it with activity, and to select the enemy’s soil for the campaign—conditions which gave us the advantage and averted from our people the evils consequent to occupancy by a foreign army and the operations of war.

The government, thus convinced, could not do less than accept the situation and do its best for a favorable result to the unwelcome war. (See Decrees Nos. 1 and 2.)

We have thus detailed the circumstances preceding the campaign in Honduras to direct your attention to the fact of the invasion of that republic without the formal declaration of war by the legislative authority, as is its prerogative, according to section 14 of the 36th article of the constitution.

It has been declared that in this case the executive usurped one of the provinces of the legislature; but, upon consideration, it appears not to be so, for it is shown that it was the government of Honduras which declared war and that ours only accepted it, selecting with prudence and activity the time and the theater for the operations of the campaign. Consequent to this was the procuration by the government of funds with which to support the extraordinary expenses of the war, when the ordinary revenue became insufficient therefor. This aroused the patriotism of the Salvadoreans, and these satisfactorily aided the government with their means. We see, therefore, that the assemblage of the legislature, under the circumstances, was unnecessary, not having to declare war, nor the manner of its prosecution.

At the same time it was absolutely necessary to make some arrests temporarily, and to banish some individuals who had aided, at every peril, the Honduranean aggressor, defeating the efforts of the government and creating every sort of difficulty in the interior.

The Marshal President, desiring to be prominent in the maintenance of the national dignity, the glory and the luster of the Salvadorean arms, resolved to direct the war in person, and therefore placed himself at the front of the army, delivering the executive power to the vice-president. The campaign opened in May. You well know, representatives, that unbroken series of triumphs, so glorious to our standard, extending the sway of liberal principles, and assuring to the nation a long era of peace and tranquillity, elements so necessary to its happiness and progress.

The aggressor being reduced to the last extremity, and deeming the war already ended, the government of Salvador, firm in its determination not to prolong the abnormal condition, if the public good, did not exact it, revoked the decrees of the 5th and 25th of April, issuing that of the 19th of June, as by No. 3.

But the greater part of the Salvadorean forces having returned triumphant, there remaining in Honduras only a small number to support the provisional government in the re-establishment of domestic order, and in its labor of re-organization General Don José Maria Medina appeared anew in Santa Barbara with a force of six or eight hundred men and munitions of war, which some disaffected emigrants from Guatemala had sent to him from northern ports. At the same time party passion burst forth in the interior. Excited by the course of events, conspiracies were formed to embarrass the action of the government, and a riot broke out in Cojutopeque, illustrating the ignorance and fanaticism of the Indians.

The abuse of the press on the part of the enemies to order had reached such a point that it was only used to enervate the government measures and to injure the authorities.

Certainly, at that time, affairs were critical. Abroad, war blazed afresh, at home, anarchy, with its horrors, threatened.

Then the government, seeing the impossibility to assemble the chambers of the legislature, and not finding in the constitution sufficient means to confront so grave a situation, firm in the belief that the principle to which all others are subordinate is the conservation and safety of the state, assumed the course which circumstances demanded, [Page 786] and the pressing necessity obliged and promulgated the decree of the 17th of July, marked No. 4.

Consonantly to this disposition, and to attain the proposed end, some persons of every estate and condition who had openly overturned order were expelled from the country. Also some new troops were sent to Honduras, which, efficiently aided by our neighbor and sister, the republic of Guatemala, continued uninterruptedly the splendid triumphs of the first campaign, even to completely destroy the last remnants of the party inimical to Salvador in that republic.

The exercise of the rights and the fulfillment of the duties anterior and higher to the positive laws recognized by the constitution, the imperative necessity to save the republic from the frightful consequences which would have attended victory on the part of General Medina, and the beneficent and splendid results which have been obtained, make clear the justice and propriety of the course pursued by the government and the good faith which has presided over all its actions.

The consolidation of order, the guarantee of peace and public tranquillity, the honor and glory of the national flag, and the spread of liberal principles—these are, representatives, the grand results obtained at the cost of very small sacrifices.

One of the advantages derived from the overthrow of the government of General Medina was the agreement signed at Gratias by the citizen Marshal President, in his quality as general-in-chief of the army, and the provisional government of Honduras, as by Schedule 5.

In this document you will find expressed the just obligations which the new government has recognized in favor of Salvador, which partly compensate for the sacrifices of the war.

Your happy convening, which has for its principal objects to remedy the defects and omissions of the constitution, shown principally by popular demonstrations, has impelled the executive to abrogate the decree of the 17th of July, to which end he has issued that of the 24th ultimo, as by No. 6.

Decrees are also submitted as to the press, and also the creation of townships in the district of Cojutopeque;

The supreme government, trusting in your patriotism and intelligence, and with an approving conscience, awaits your judgment upon all its dispositions and measures which have been specified, and doubts not but that you will give to it your approval.

The proclamations of the President, and many other papers published by the official press, clearly state the true causes of the conflict provoked by Honduras, and of all the intrigues and machinations in the interior, which favored the designs of the Honduranean leader; but, if possibly you may deem more precise data necessary for resolution upon the points submitted, we will present all others which you may request.

  • The Minister of Foreign Relations,
  • The Minister of the Treasury and War,
    J. J. SAMAYOA.
  • The Minister of Public Instruction and Government,
[Inclosure 2.—Translation.]

general ministry.

The President of the Republic of Salvador to Us inhabitants:

Know ye that the National Constituent Congress has decreed the following:

The National Constituent Congress of the republic of Salvador, considering that it is a duty of the executive to maintain inviolate the sovereignty and independence of the republic; and that, complying with this sacred duty, he has dictated proper measures, and acted conformably to the exaction of the abnormal circumstances in which the country was placed by the unjustifiable war, which, under date of the 25th day of March last, was declared by the government of Honduras, presided over at that time by the General Don José Maria Medina;

That the executive authority in issuing the decree of the 17th of July last, and in all the consequential procedures, has had for his only object to preserve the peace, and the interior tranquillity threatened, not only by the seditions in Cojutopeque, but also by the designs of some discontented with the actual order of things; decrees:

Only article: All the acts of the executive comprised within the memorial or exposition [Page 787] which, dated the 4th of the present month, the ministers of state in their respective departments have brought to the knowledge of this assembly, are approved.

To the executive authority.

    Deputy President.
    Deputy Secretary.
    Deputy Secretary.

Therefore let it be published.
  • The Minister of Foreign Relations,
    Gregorio Arbizu.
  • The Minister of the Treasury and War,
    J. J. Samatoa.
  • The Minister of Public Instruction, Justice, and Ecclesiastical Affairs, encharged with the Ministry of the Interior,
    Fabio Castillo.
[Inclosure 3.—Translation.]
[Extract from the Boletin Oficial of the 31st October, 1872.]

The President of the Republic of Salvador to its inhabitants:

Know ye that the National Constituent Congress has decreed as follows:

The National Constituent Congress of Salvador, considering that the establishment of a bank for loans on mortgages of real estate, (banco hipotecario-agricola,) with circulation and discounts, will greatly contribute to the progress of the agriculture, industry, and commerce of the country; and that it is a paramount duty of those charged with the direction of the destinies of the nation to procure by all possible measures its prosperity and well-being; decrees:

  • Article 1. The supreme executive power is authorized, with shareholders both from within and beyond the republic, to establish in the country a bank for the hypothecation of real estate, with circulation and discounts.
  • Art. 2. The foundation capital of said institution shall not exceed five millions of dollars.
  • Art. 3. The privileges and guarantees that the government gives to the shareholders shall last twenty-five years.
  • Art. 4. The government shall not intervene in the management of the bank, and only shall have an inspection upon it.
  • Art. 5. The institution shall place itself under the protection of some foreign flag.
  • Art. 6. The nation shall have a portion of the advantages of the institution, and with this conception the government may guarantee to the shareholders a moderate conventional interest, conceding at the same time such privileges as it may deem convenient.
  • Art. 7. The notes of the bank shall be treated by the government as cash.
  • Art. 8. The rates which the bank shall fix in its division of hypothecation shall be ten per cent. of yearly interest, payable every three months, and five per cent. for amortization (cancellation) at the least at the end of the year.
  • Art. 9. The maximum rate of the bank in its operations of circulation and discount shall be twelve per cent. of annual interest, payable every three months.
  • Art. 10. To aid the operations of the institution the government shall publish the law of hypothecations, and all others tending to make effective the credits of the bank, without the formularies which are ordinarily exacted.

To the executive authority.

    Deputy Vice-President.
    Deputy Secretary.
    Deputy Secretary.

Therefore let it be executed.
  • The Minister of Justice,
    Fabio Castillo.